If we return in time in mid-2019, we can remember a debate that marked a change in the crypto market and in the world. We refer to the controversy that caused Facebook with Libra, generating multiple discussions all over the world.
Even at that point came the influence of Libra that Central Banks around the world decided to launch their digital currencies, being the CBDC. Today Vitalik Buterin, founder of Ethereum brought the issue back, supporting the private digital currencies.
What is the debate?
First of all, as it is an issue we discussed months ago, it is good to remember the main foundations of the discussion about private and public currencies. In this way we can comfortably understand the opinion of Vitalik Buterin.
When they announced the Libra project, the discussion was born if private companies can and should own coins. The reason why noise was made regarding the issue was because of information management, fearing that companies had a lot of power.
Those who mainly feared on this subject were those from the opposite sector, who even repeatedly questioned Facebook and Buterin himself, being the governments.
In the end, the administrations of the countries are the maximum representation of the public sector, representing in theory the interests of the citizens, ensuring their safety.
Therefore, from this discussion a proposal is born to compete with private digital currencies, being the Central Bank Digital Coin, or better known, the CBDC. On several occasions we have exposed on this subject, available to you readers.
Once the topic we are going to discuss is known, we can observe the comments made by Buterin on private digital currencies, highlighting that he raises decentralization as a fundamental element.
Buterin spoke with the Block TV podcast on March 4 about his stance regarding digital currencies, specifically the power of decentralization even without Blockchain.
He said that digitalization is inevitable and that decentralized digital currencies would be more favorable to many than state-controlled CBDCs.
Buterin said there are three existing types of sovereign, corporate and decentralized digital currencies. In addition, he highlighted the challenges facing CBDCs:
“The main challenge with the central bank and even with the corporate currency is basically the concentration of power, storage or data collection: that it becomes dependent on potentially central intermediaries that can exercise a very fine degree of control over who has the capacity of participating in these systems and who can’t. ”
Vitalik foresees that the most attractive future currency will be decentralized and private, since it would be more resistant against “centralized strangulation points”. He added that:
“We have been seeing many situations in which even things that are perfectly legal end up restricted because whoever manages centralized choke points just wants to exclude some category of users and I think those are the reasons why people will continue to be interested in decentralizing completely digital currency ”.
Therefore, from the comments of Vitalik Buterin we can see that he proposes the solution to the discussion last year. Even if Blockchain is not used, decentralization of digital currencies is key to the future.